Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Classic TA Workplace -- Ignore unavailable to you. Want to Upgrade?

To: Shack who wrote (57912)	10/29/2002 10:44:09 AM
From: Perspective	Respond to of 209892

A retest of the SPX neckline would be part of a correction of the twenty-week decline we launched in March of this year. If we aren't going to retest the neckline, we're either in a correction one order magnitude lower (just correcting the most recent six-week decline) or one order higher. I still say it is virtually impossible to find enough counterbalancing forces to stop the momentum of the bear long enough for it to correct the entire bear here. Market momentum rules, pushing price until there just isn't any possible way for price to go any further. The market is a positive feedback machine that runs until it exhausts all available fuel. Perhaps there is another solution - we are still correcting the twenty week decline from March, but we do it in time rather than price, ie we never achieve the neckline, but spend more time waffling around 900. It is interesting to note the unbelievable cycle correlation to the Nikkei decline. Does anyone have the "official" count on the Nikkei bear? After their lengthy intermediate rally that launched in 1990, they had a similar four-month decline that was corrected by a sharp (in Elliot terms), three-month rally. A notable difference is that they had not yet broken their neckline, which we have done. However, if we followed a similar pattern - three-month sharp rally - it would take us up briefly over the neckline, to SPX 1000, before launching into a violent recognition wave that would bring us near to the measured move target for the SPX H&S in the low 600s. Perhaps that will be the roadmap I use going forward, until proven wrong. If so, we are in 2 of C of the sharp correction, headed briefly over the neckline after this pullback. Sounds like a good idea - gets the favorable seasonals taken care of, and would create enough bear doubt and pain to finally let this thing purge. Liquidity should be a serious issue if we are double-dipping in the early part of 2003. BC